Stocks fell for a third day, led by Quanta Computer Inc (
Chipmakers Taiwan Semiconductor Manufacturing Co (TSMC,
The TAIEX tumbled 94.04, or 2.2 percent, to 4,139.50. The benchmark index has fallen 9.3 percent over the past three days, its steepest fall since the three days that ended Sept. 19, 2001. Only 55 of the 610 stocks on the Taiwan Stock Exchange gained.
MSCI Taiwan futures for April delivery in Singapore declined 1.6 percent to 176.90. The Taiwan Futures Index dropped 2 percent to 4,125.
"We believe many investors have overlooked potential demand implications" of SARS, Kirk Yang, an analyst at Smith Barney, said in a report.
"Technology spending is closely correlated with economic growth, PC and handset demand in China could be negatively affected," he said.
Citigroup has cut its forecast of China's economic growth to 6.7 percent from 7.6 percent, the report said.
TSMC fell NT$1.5, or 3.3 percent, to NT$44.
Citigroup analyst Clark Westmont cut his recommendation for the chip industry to "underweight" from "market weight." Inventories of chips have risen and share prices already reflect earnings prospects, Westmont said in a note to clients.
Quanta Computer, which makes notebook computers at a plant near Shanghai, fell NT$2, or 3 percent, to NT$64. Asustek, which makes more of its motherboards in China, fell NT$3, or 4.3 percent, to NT$66.50.
"Investor confidence has been destroyed by the SARS outbreak," said Reming Yu, chief investment officer at Prudential Securities Investment Trust Co (
CMC Magnetics Corp (中環) rose NT$0.10, or 0.6 percent, to NT$16.40. BenQ Corp (明基電通) fell NT$1.7, or 4.5 percent, to NT$35.80.
Powerchip Semiconductor Corp (力晶半導體) fell NT$0.55, or 6.5 percent, to NT$7.95. It said it turned to a first-quarter loss of NT$2 billion after sales tumbled. The company had net income of NT$611 million a year earlier. Sales, previously announced, fell 18 percent to NT$3.1 billion from NT$3.8 billion.
ISSUES: Gogoro has been struggling with ballooning losses and was recently embroiled in alleged subsidy fraud, using Chinese-made components instead of locally made parts Gogoro Inc (睿能創意), the nation’s biggest electric scooter maker, yesterday said that its chairman and CEO Horace Luke (陸學森) has resigned amid chronic losses and probes into the company’s alleged involvement in subsidy fraud. The board of directors nominated Reuntex Group (潤泰集團) general counsel Tamon Tseng (曾夢達) as the company’s new chairman, Gogoro said in a statement. Ruentex is Gogoro’s biggest stakeholder. Gogoro Taiwan general manager Henry Chiang (姜家煒) is to serve as acting CEO during the interim period, the statement said. Luke’s departure came as a bombshell yesterday. As a company founder, he has played a key role in pushing for the
China has claimed a breakthrough in developing homegrown chipmaking equipment, an important step in overcoming US sanctions designed to thwart Beijing’s semiconductor goals. State-linked organizations are advised to use a new laser-based immersion lithography machine with a resolution of 65 nanometers or better, the Chinese Ministry of Industry and Information Technology (MIIT) said in an announcement this month. Although the note does not specify the supplier, the spec marks a significant step up from the previous most advanced indigenous equipment — developed by Shanghai Micro Electronics Equipment Group Co (SMEE, 上海微電子) — which stood at about 90 nanometers. MIIT’s claimed advances last
EUROPE ON HOLD: Among a flurry of announcements, Intel said it would postpone new factories in Germany and Poland, but remains committed to its US expansion Intel Corp chief executive officer Pat Gelsinger has landed Amazon.com Inc’s Amazon Web Services (AWS) as a customer for the company’s manufacturing business, potentially bringing work to new plants under construction in the US and boosting his efforts to turn around the embattled chipmaker. Intel and AWS are to coinvest in a custom semiconductor for artificial intelligence computing — what is known as a fabric chip — in a “multiyear, multibillion-dollar framework,” Intel said in a statement on Monday. The work would rely on Intel’s 18A process, an advanced chipmaking technology. Intel shares rose more than 8 percent in late trading after the
GLOBAL ECONOMY: Policymakers have a choice of a small 25 basis-point cut or a bold cut of 50 basis points, which would help the labor market, but might reignite inflation The US Federal Reserve is gearing up to announce its first interest rate cut in more than four years on Wednesday, with policymakers expected to debate how big a move to make less than two months before the US presidential election. Senior officials at the US central bank including Fed Chairman Jerome Powell have in recent weeks indicated that a rate cut is coming this month, as inflation eases toward the bank’s long-term target of two percent, and the labor market continues to cool. The Fed, which has a dual mandate from the US Congress to act independently to ensure